Correlation Between Oxbridge and MRC Global
Can any of the company-specific risk be diversified away by investing in both Oxbridge and MRC Global at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Oxbridge and MRC Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oxbridge Re Holdings and MRC Global, you can compare the effects of market volatilities on Oxbridge and MRC Global and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Oxbridge with a short position of MRC Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oxbridge and MRC Global.
Diversification Opportunities for Oxbridge and MRC Global
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Oxbridge and MRC is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Oxbridge Re Holdings and MRC Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MRC Global and Oxbridge is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Oxbridge Re Holdings are associated (or correlated) with MRC Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MRC Global has no effect on the direction of Oxbridge i.e., Oxbridge and MRC Global go up and down completely randomly.
Pair Corralation between Oxbridge and MRC Global
Given the investment horizon of 90 days Oxbridge Re Holdings is expected to generate 3.72 times more return on investment than MRC Global. However, Oxbridge is 3.72 times more volatile than MRC Global. It trades about 0.13 of its potential returns per unit of risk. MRC Global is currently generating about 0.45 per unit of risk. If you would invest 382.00 in Oxbridge Re Holdings on October 23, 2024 and sell it today you would earn a total of 50.50 from holding Oxbridge Re Holdings or generate 13.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oxbridge Re Holdings vs. MRC Global
Performance |
| Timeline |
| Oxbridge Re Holdings |
| MRC Global |
Oxbridge and MRC Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oxbridge and MRC Global
The main advantage of trading using opposite Oxbridge and MRC Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oxbridge position performs unexpectedly, MRC Global can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in MRC Global will offset losses from the drop in MRC Global's long position.| Oxbridge vs. Muenchener Rueckver Ges | Oxbridge vs. Greenlight Capital Re | Oxbridge vs. Maiden Holdings | Oxbridge vs. Swiss Re |
| MRC Global vs. NOV Inc | MRC Global vs. Ranger Energy Services | MRC Global vs. Oil States International | MRC Global vs. Geospace Technologies |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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